General questions about franchising

In this section, experts answer general questions most commonly asked which go beyond the specific subject areas listed above.

How are business tasks divided up between the franchisor and the franchisee?

Ideally, franchisors and franchisees are responsible for those functions and
activities to which they are most suited as a result of their market position,
their qualifications and their means. In the course of the division of tasks
franchisors are responsible for all functions which can be carried out more
effectively and more cheaply from head office. In contrast to this franchisees
take over those tasks which he can fulfil more effectively from his position on
the market.

Franchisors are responsible for the identity, image and functional ability of
franchise systems. In this connection they take over the task of looking for and
selecting franchisees, ensure that the head office fulfils its responsibilities
towards franchisees and guarantee – by applying the principles and instruments
of cooperative management – that the regulations, which are necessary for
maintaining the functional ability of the system, are kept to.

Franchisees put capital, work, contacts and information into the business.
Generally they concentrate on financing all necessary investments, running the
franchise business and undertaking all necessary measures to achieve acceptable
sales. As well as this they attempt to build up long-term relationships with
their customers and pass on any relevant information to the head office which
helps to ensure that the functional ability of the system is
maintained.